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The gas field is the primary energy project in Kola

The gas field is the primary energy project in Kola. The Murmansk region is undergoing a radical change. For the last few decades, the region has remained in the shadows as the rest of Russia has progressed. Major investments in energy production in the north are now ahead, but in the prevailing economic situation they will start off slowly .

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The Murmansk region is undergoing a radical change. For the last few decades, the region has remained in the shadows as the rest of Russia has progressed. Major investments in energy production in the north are now ahead, but in the prevailing economic situation they will start off slowly .

The investments focus on the construction of the Shtokman field, the launch of production, and the infrastructure related to the project. However, an actual investment decision has not yet been made. At the moment, other big projects are left on the sidelines. The plan of constructing an oil pipeline from the oil fields of Nenetsia to Murmansk has been postponed for the time being. The construction of phase two of the Kola nuclear plant also seems to be postponed. Extensive plans have been made concerning harbour projects in Murmansk in the next few years, but they have not proceeded to the construction stage.

Energy management in the Kola region is mainly based on nuclear power, hydroelectric power and oil. The Kola mining industry, important for all of Russia, receives its electric power from a nuclear plant located in Polyarnye Zori, meeting about 50% of the electricity demand in the entire region. Over 40% of the electricity production originates from the region’s hydroelectric power plants, totalling 17 plants. Less than 10% of electricity is produced from fossil fuels in three plants.

In the Kola region, heat energy is produced in heating plants mainly using heavy fuel oil. Some remote districts, such as military locations, burn coal.

Coal from Siberia, oil from Nenetsia

The Murmansk harbour is very important for the import of both oil and coal. Long trains laden with coal come all the way from Siberia to the coal harbour where ships leave for destinations around the world. Oil from the Nenetsia fields is transported from the Varandei oil terminal by tankers to Murmansk where the oil is transferred to ocean tankers in the floating Belokamenka vessel.

According to the Russian state’s transport system plan, the intention is to triple the capacity of the Murmansk harbour in 2010to 2015. In the Kola region, the plan includes a total of EUR 11 billion in investments concerning harbours, loading terminals, roads and railroads. The key projects deal with constructing a new oil terminal and a new coal terminal.

A new terminal is also being planned for freight container transportation – with the terminal, the infrequent freight container transportation would become an important line of business. Investments in the road and railroad network are essentially related to it. In the Kola region, it is also intended to allocate public funds to improving the power transmission network and to constructing houses.

So there are more than enough massive building project planned, but is there enough funding to execute them? The situation is difficult for foreign companies which want to participate in the projects: despite the extensive plans, no actual investment decisions have been made, and clear schedules are non-existent.

However, in the long term, most of the projects must be carried out in order to launch the production at the Shtokman field in general, and to prevent further recession in the Kola region. As always, business operations in Russia require patience.

Nuclear power is also required in the gas field

The effects of the economic crisis of 2008 on industry in Kola can be seen in an overcapacity of nuclear power. Kola NPP produces electric power according to the industry demand only. According to Vasili Omeltshuk, plant director, the electric production this year will remain about 30% below the peak production level. The combined capacity of Kola NPP’s four units is 1,760 megawatts. For next year, industry orders for electricity will equal this year’s production. Transmission of electricity to other destinations is minor due to the limited capacity. Nuclear-power-based electricity is not exported to Finland or Norway.

According to Russia’s ambitious nuclear power plan, the intention is to construct four new nuclear power units in Kola to replace the units built in the 1970s. The schedule says that the new phase-two units would be introduced in 2018–2021. Omeltshuk says that the investments will be postponed – there are no practical project plans at the moment. The two oldest units of Kola NPP have been granted extended operation permits until 2018 and 2019. The operation permits of units 3 and 4 are still original and will expire in 2011 and 2014, respectively.

Although Kola NPP currently has 350 to 400 megawatts of extra production capacity, it will not last long. The first construction stage of the Shtokman gas field requires a total of 600 megawatts of electric capacity.

According to Omeltshuk, nuclear power is an important part of the Shtokman project. The nuclear plant cooperates with the TGC-1 energy company, producing hydroelectric power in the Kola region in order to ensure power supply to the gas field.

The environmental organisation Bellona reckons that an underwater nuclear power unit is being planned, which would produce electric power required for the drilling in the gas field.

Heat is still regulated via windows

In its climate policy, Russia commits to emission reductions of 10 to 15% by 2020.

The aim also is to increase energy efficiency by 40% by 2020.There is a lot to improve in the Kola region when it comes to energy efficiency, and this would decrease carbon dioxide emissions at the same time. However, the residents do not consider energy issues that important, as there are so much more pressing issues: groundwater contaminated with heavy metals and toxins, waste dumping all over the place, sulphur dioxide emissions from the industry, old dumping sites for radioactive waste, oil emission in the sensitive marine environment, the dust caused by mines, defective or non-existent sewage treatment, and so on.

Here is an example: The City of Murmansk is heated with district heating subsidised by the municipality. The heat is produced by two plants based on heavy fuel oil, which are operated at full blast for the most of the year. Residents regulate their heating by opening the windows because usually the radiators of the apartments are lack any sort of check valve. And if there is a check valve, you can only either fully open or fully close it. A thermostat valve is an unknown concept.

During the plant stoppage in the summers, typically lasting a few weeks, residents do not even get warm household water. Then they use their own warm water boilers operating on electricity.

The solution seems to be simple: if thermostats would be installed in the apartments, all residents in the housing cooperative would save on energy expenses. However, this cannot be done. During the Soviet era, the apartments were state-owned, and the state ensured that there was enough energy to go round. Now, the apartment is owned and taken care of by the resident. But, someone else must take care of everything outside their own walls, and this should not cost anything. For most residents, cooperation in the housing cooperative and paying joint bills is an impossible idea. This means that thermostats will not be acquired either.

Harriet Öster

The author is a freelance journalist specialising in, among others subjects, the process industry and energy issues. In August 2009, she paid a visit to the Kola region.

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